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Chargeback: Money back in the event of cancellation or bankruptcy thanks to a credit card

With a chargeback, in the event of an airline, travel agency, hotel ... becoming insolvent, you can get back your paid money for which no service has yet been provided. In addition, a chargeback can also be helpful in the event of a cancellation / cancellation on the part of the airline if the airline refuses to reimburse the money and, for example, only offers a voucher. The prerequisite for this is that you have paid for the trip with a credit card.


First Air Berlin, then Germania and now Thomas Cook. It happens again and again that airlines or tour operators have to file for bankruptcy and cease operations. As a customer, you are also forced to pay the full amount or at least a deposit directly when booking, often well before the service, i.e. the trip or flight, is provided.

In the event of bankruptcy, you are stupid as a customer: your money is gone, the flight or trip will not take place and you have to find an alternative yourself and thus pay twice.

You can register your claim in the insolvency table after bankruptcy proceedings have opened. The chances of getting back even a fraction of the money paid are usually poor. At Air Berlin, the claims of the creditors amount to over one billion euros.

The bankruptcy of Air Berlin and Germania already showed that you have the best chances of getting a refund, if you paid by credit card and a so-called Performs chargeback.

Cancellation / cancellation

The massive flight cancellations during the coronavirus have resulted in airlines often refusing to reimburse their customers for cancellations. According to the EU Air Passenger Rights Regulation, such a reimbursement must actually be made within 7 days. Most airlines also provide full reimbursement in their conditions of carriage for cancellations on their part.

If the airline rejects a refund and instead only offers a rebooking or voucher, a chargeback can bring the money back to your account without dragging the airline to court. To do this, however, an attempt must first be made to reach an agreement. If the airline consistently rejects a refund, you can ask your bank to carry out a chargeback.

How does a chargeback work?

A chargeback is intended to protect consumers from credit card fraud, but also from services that have not been provided.

With a credit card payment, up to three parties are involved in addition to the consumer and merchant:

  1. Customer bank (issuer): Your bank, which issued you the credit card and debits the money from your account
  2. Credit card network: Payment service provider who carries out the payment and provides the infrastructure, usually Visa, Mastercard ...
  3. Merchant bank (acquirer): The merchant's bank or acquiring bank that receives the payment, processes it and pays it out to the merchant.

If you apply for a chargeback at your customer bank (1), a case will be opened with the credit card network (2) and the merchant bank (3) will be asked for an explanation. This then asks the dealer to provide evidence that the payment was justified or that the service was performed correctly. If the merchant cannot prove this or can only prove it inadequately, the credit card network (2) decides on the validity of the chargeback.

American Express is a special case. Since American Express issues the credit cards directly, there is no issuing bank (1). This has the disadvantage that American Express itself may be liable for the damage and is therefore much more partial to the retailer in the event of complaints.

Where does the money come from?

In case of doubt, the merchant's bank is liable for unjustified payments. That is why the bank is of course careful to only work with reputable dealers. For example, if a merchant has too high a chargeback rate, he must expect a fine or even an account blocking.

In addition, the dealer bank always holds a part (often 5-15%) of the payments, the so-called Rolling reserve, back to the dealer in order to settle possible chargeback claims. It is not uncommon for the retailer's bank to request significantly more collateral from an airline or tour operator that has financial problems than from a group that has been in the black for years. That always depends on the bank's risk management.

Usually the bank takes back the receivables from a chargeback, incidentally including a fee, from the merchant. However, if the customer can no longer provide the services because he is bankrupt or has filed for bankruptcy, the bank is liable for all outstanding claims from the repayment claims.

The trader's bank then in turn has the option of collecting their claims from the trader or registering them in the insolvency table in the event of bankruptcy. The consumer still has to be compensated immediately.

That's why you don't have to worry about unjustifiably withdrawing money from an insolvent company, because that is not the case here and would also not be legally possible.

Would you prefer to book your next trip with a credit card? Then check out our credit card comparison! A good travel credit card does not have to be expensive, in most cases there are no monthly / annual fees at all, you can pay in foreign currencies without fees and withdraw cash without fees.

Chargeback in the event of bankruptcy

The credit card networks such as Visa or Mastercard have clearly defined rules when a chargeback is possible. For example, the 400-page Mastercard Chargeback Guide can be found on the Internet. Visa will also provide such a guide, but it is not publicly available on the Internet.

If the service is not provided, the following rule can be found on page 58 of the Mastercard Chargeback Guide, according to which a chargeback can be carried out. There even travel services, tour operators and travel agencies are explicitly discussed:

Goods or Services Not Provided

Chargeback condition. One of the following:

- The cardholder contacted the issuer claiming both of the following:
- - The cardholder engaged in the transaction.
- - The purchased goods or.

Mastercard Chargeback Guide page 58

Accordingly, it is sufficient that the tour operator or travel agency that arranged the travel service (e.g. a flight, hotel, package tour ...) has ceased operations. Of course, this applies to bankruptcy. In the event of cancellation / cancellation by the airline, the service was not provided.


A chargeback can only be carried out within a certain time window. Usually the clock starts ticking from the time of the transaction or the time of delivery. When it comes to travel, Mastercard clearly has the last one Time of performance defined (usually time of departure or landing of the return flight). From then on, Mastercard has at least 120 days to carry out a chargeback:

Time frame.

Time frame.

One of the following:

1., whether the bonding authority or similar scheme responded or not. The issuer must wait at least 30 calendar days from the date the request was sent prior to processing a chargeback, unless a negative response was received, in which case, the chargeback may be processed upon receipt of the negative reply.
The following exceptions apply:
-, whether the bonding authority or similar scheme responded or not. The issuer must wait at least 60 calendar days from the date the request was sent prior to processing a chargeback, unless a negative response was received, in which case, the chargeback may be processed upon receipt of the negative reply.
- For Polish Domestic Transactions: Maximum 540 calendar days from the Central Site Business Date, whether the bonding authority or similar scheme responded or not. The issuer must wait at least 60 calendar days from the date the request was sent prior to processing a chargeback, unless a negative response was received, in which case, the chargeback may be processed upon receipt of the negative reply.
- For Swedish Domestic Transactions: Maximum 120 calendar days from the latest expected service date.
2. Maximum 120 calendar days after from the expected service date.
In all cases, the issuer does not have to wait for the latest expected service date before processing the chargeback. . The issuer is still obliged to meet all other applicable chargeback requirements, such as a request for reimbursement from the bonding authority or similar scheme.

Mastercard Chargeback Guide Page 62 - Failed Travel Merchant — Intra-EEA and Domestic European Transactions Only

The chargeback can of course also be carried out before the time of performance if it is clear that the service will no longer be provided (e.g. if the travel service provider becomes insolvent or a flight is canceled). In addition, the chargeback can then be carried out directly and you do not have to wait for the response from the retailer.

Security certificate & insurance against bankruptcy

Before a chargeback can be carried out, it must be clarified whether the trip is covered by insurance. This is especially the case with package tours with the travel insurance certificate. Individual travel modules, e.g. just a flight, hotel or rental car, are usually not insured against insolvency.

Chargeback condition.

For Intra-EEA and domestic European Transactions, when the cardholder contacted the issuer claiming a travel service has not, or will not, be provided, and when the merchant is seeking protection from creditors, insolvent, bankrupt or in liquidation, at least one of the following conditions must be met:

1. The travel service was covered by a bonding authority or similar scheme according to local law, and one of the following:

- For Swedish Domestic Transactions: no additional requirement. The cardholder (or traveler) is not obligated to request reimbursement from a bonding authority or similar scheme prior to the issuer raising a chargeback. The cardholder (or traveler) does not need to request reimbursement from the bonding authority or similar scheme if the merchant, bonding authority or similar scheme publicly states that the bond is insufficient prior to the chargeback.
2. The travel service was not covered by a bonding authority or similar scheme according to local law, or neither the issuer nor the cardholder after reasonable effort can determine whether the travel service was covered by a bonding authority or similar scheme according to local law.

Mastercard Chargeback Guide Page 62 - Failed Travel Merchant — Intra-EEA and Domestic European Transactions Only

In the event of the insolvency of a tour operator, the travel insurance certificate is intended to ensure that the insurance company takes care of the repatriation of the holidaymakers but also reimburses down payments made. However, the security certificate in Germany apparently has a major design flaw. According to the current status, the insurer only has to be liable for damage up to 110 million. This is enough for smaller organizers, but for giants like Thomas Cook this sum will certainly not be enough. Those affected will then only be partially compensated.

Unfortunately, it is not entirely clear whether a chargeback is still possible in this case. Mastercard only allows a chargeback if the insurer's application has been rejected or the compensation has not been received. It is not clear whether a chargeback is also possible if you are only reimbursed a fraction of the amount. At least one could argue that a request for full reimbursement has been denied if only a fraction will be reimbursed.


You have to submit an application for a chargeback directly to your bank. The procedure is different depending on the bank. Most of the time you have to fill out a complaint form and tick a reason there. For American Express credit cards, an application must be submitted claim can be sent directly to American Express.

Not every bank employee is well trained in handling chargebacks. With the Air Berlin and Germania insolvencies, it has happened again and again that a chargeback was rejected by the bank employees. Here you should definitely persevere and, if necessary, refer to the relevant section in the chargeback guide, e.g. from Mastercard.

Before you carry out a chargeback, you should try to enforce the requirement in another way. In order to be able to present the experiment to the bank later, this should be done in writing and not just by telephone. It's hard to prove later.

It is also advisable to put the application for chargeback at your bank and further communication in writing and not just get rid of the phone on the phone.

Some banks are even very exemplary in dealing with insolvencies and deliberately inform their customers about the possibilities of a chargeback. In any case, the DKB should be emphasized here, which informed its customers of a chargeback in the case of Air Berlin, Germania, Thomas Cook insolvency and also in the case of the coronavirus.

What is your experience with chargeback in the event of bankruptcy or cancellation? In our forum you will find some testimonials and you are welcome to describe your own experience.

When booking via the travel portal / office

Many passengers do not book directly with the airline, but via a local travel agency or online travel portal (OTA for short) e.g. Opodo, Expedia, ... In most cases, the booking amount is not debited directly from the airline, but from the travel agency / portal . The middleman is only the intermediary and passes the money on to the airline, usually minus a booking fee. The service was provided with the mediation.

If you now carry out a chargeback, the reverse booking does not hit the airline directly, but the travel agency, which has provided the service (brokerage).

According to Mastercard, a chargeback by the customer bank is entitled to the travel agency, because by accepting the customer's payment the travel agency must also be responsible for a chargeback if the service is not provided. You could also have the money debited directly through the airline. Accordingly, a chargeback against a travel agency is also entitled.

Question: The cardholder’s flight has been canceled and the transaction was billed by an online travel agent (OTA). The OTA tells the cardholder that they are.

Answer: . In these circumstances, Mastercard would view the OTA as the merchant of record, and an agent of the travel supplier, regardless of the terms and conditions disclosed to the cardholder. Under Mastercard Standards, the OTA, by the cardholder (e.g. flight) and not just for handling the reservation,. The OTA should work closely with its travel partners or travel suppliers to avoid a cardholder getting reimbursed twice for the same transaction.

Mastercard Dispute Resolution Management During COVID-19

frequently asked Questions

What if I did not book directly with the airline, but through an (online) travel agency?

According to Mastercard, a chargeback is also possible against a travel agency because the service has not been rendered, because by accepting the payment they have also assumed responsibility. More about it here.

Is a chargeback also possible with direct debit?

In principle, there is also the option of canceling the payment with direct debit. Even without giving a reason! However, the revocation is only possible up to 8 weeks after the time of payment. There is an exception if no direct debit mandate has been issued, in which case a reverse booking is possible up to 13 months after payment.

What if I paid by bank transfer?

A payment by bank transfer was deliberately carried out by you and cannot be reversed. In the event of bankruptcy, the only way to get some of your money back is to put your claim on the bankruptcy table. Or the travel insurance certificate for package tours.

Is a chargeback possible for package tours despite a security certificate?

Unfortunately, this is currently not legally clarified. Actually, the insurance company that issued the security certificate has to pay for the damage first. However, there is the liability limit of 110 million euros, which will probably not be sufficient to enable 100% reimbursement for all holidaymakers. If a partial refund is interpreted as a rejection of the application, a chargeback would also be possible here.

What if I paid for the trip several months ago?

When traveling, the time of performance is decisive for the deadline. That's why it's not a problem if you booked the trip six months ago and has now been canceled due to bankruptcy.

Cover picture: © pic3d -


I founded Travel-Dealz in 2010 and have been writing about the latest travel deals every day. Since I was 17, I've been looking for ways to fly as cheaply as possible. With my knowledge, I try to do exactly the same for you. If you have a question you can always contact me! Just write me an email to: [email protected] Please do not confuse this with a travel agency.

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